PRECIOUS-Gold firms, on track for narrowly positive November

LONDON, Nov 30 (Reuters) - Gold edged up on Friday, on
course to squeeze out a gain for November, but progress was
capped as the market took its cue from hesitant sentiment in
stock markets on mixed signals around talks to avoid a U.S.
budget crisis.

Spot gold gained 0.30 percent to $1,729.91 an ounce
by 1243 GMT, headed for a 1.3 percent weekly drop but a 0.6
percent monthly gain. U.S. gold GCcv1 was up 0.19 percent at
$1,730.50.

While bullion recovered from a 1-1/2-week low of $1,705.64
an ounce hit on Wednesday in a technically-driven sell-off,
upside resistance held at $1,750 an ounce in a market roiled by
conflicting comments from Washington about the U.S. budget
negotiations.

House of Representatives Speaker John Boehner said on
Thursday that "fiscal cliff" talks with the White House had made
no substantive progress and criticized President Barack Obama
and Democrats for failing to get serious about including
spending cuts in a final deal.

If the parties fail to reach an agreement, $600 billion in
tax hikes and spending cuts - dubbed the "fiscal cliff" - will
automatically start in early January, threatening to push the
world's top economy into recession.

Analysts have said that protracted and faltering progress in
the fiscal talks would support gold's safe-haven credentials,
but the market is in risk asset mode - taking impetus from
stocks and other assets associated with growth.

"We're back in the middle of a range. $1,750 is difficult to
break," said Simon Weeks, head of precious metals at Scotia
Mocatta.

"A weaker dollar is the key factor supporting the price, but
gold has still not fully recovered from Wednesday's selloff."

Weeks said that if a breakthrough does emerge in the U.S.
fiscal negotiations, gold would likely initially follow any
bounce in risky assets such as shares and commodities, before
disconnecting.

"The knee jerk reaction will be for gold to follow other
markets up or down, and after its initial reaction, it will tend
to decouple," he said.

Technical analysis suggested signals were mixed for spot
gold, as it was not clear that a rebound from Wednesday's low
$1,705.64 had been completed, according to Reuters market
analyst Wang Tao.

On the investment front, Commerzbank said in a daily market
report on Friday that inflows of gold into exchange-traded funds
(ETFs) highlighted buoyant demand for the yellow metal.

"ETF investors, who are generally regarded as taking a
longer-term view, are proof that gold remains in high demand as
a store of value and a safe haven despite all the price
fluctuations," Commerzbank said.

"We are confident that the gold price will continue to climb
in 2013."

Holdings of SPDR Gold Trust GLD, the world's biggest
gold-backed exchange-traded fund, stood at a record high of
1,347.018 tonnes, up nearly 11 tonnes in its fourth consecutive
month of rise.

Global gold demand in 2013 should be led by further strength
in Chinese demand and a recovery in India, helping the precious
metal continue its bull run into its 13th year, the
industry-backed World Gold Council said on Friday.

Gold importers in India, the world's biggest buyer of the
metal, continued to pile up bargain stock in view of the wedding
season, as prices extended losses for a fourth day to hit their
lowest level in two weeks.

PALLADIUM RISING

Spot palladium rose 0.19 percent to $683, on course
for a fifth week of gains and a monthly rise of more than 14
percent, its strongest since December, 2010.

Concerns about supply and technical buying helped send
palladium to a 2-1/2-month high of $689 on Thursday.

Norilsk Nickel, the world's largest producer of palladium
and nickel, expects the palladium market to remain in a deficit
in the next several years largely due to a near depletion of
Russian state supplies.

Spot silver inched up 0.23 percent to $34.29, on
course for a monthly gain of more than 6 percent.

Spot platinum was headed for a rise of more than 3
percent in November, and last traded at $1,614.5 per ounce, up
0.37 percent.
(Editing by Veronica Brown and William Hardy)